There's growth in the UK economy - but no thanks to the banks
Crowdfunding industry body, the Peer 2 Peer Finance Association (P2PFA) has released figures that show the robust health of crowdfunding as an alternative source of finance for business. The P2PFA figures show that "peer-to-peer lenders lent over £500 million of new money in the first half of 2014 alone, demonstrating a further acceleration in the growth rate of growth of this important new sector. The aggregate rate of flow of funds through p2p platforms has doubled over the last 6 months.
Christine Farnish, chair of the P2PFA, said: "Peer to peer lending is consolidating its position as a good value and reliable form of funding for credit worthy consumers and small businesses, and more and more consumers are turning to p2p lending as a good way of putting their spare cash to work. As we continue to grow we are committed to maintaining the highest standards of business conduct and are working with the FCA to ensure a smooth transition to statutory regulation."
The Sunday Times (subscription needed) takes this statistical ball and runs with it, claiming that "lending is to hit £1 billion as savers continue to lend record amounts of money to businesses and individuals through P2P websites. More than £1.48bn has been lent since 2010, up from £1.21bn in the previous quarter, according to figures due to be released today (Monday). The Peer2Peer Finance Association, which started collecting the data in 2010, said that in the three months to the end of June, £273m was issued in new P2P loans, up from £247m in the previous three months."
Scotland On Sunday sees the UK's economic recovery without the active particiaption of bank lending as the equivalent of a medical miracle. The paper criticises banks' reluctance to lend to small and mediu-sized enterprises (SMEs), and reports that "the government's funding for lending scheme launched in the summer of 2012, but lending to SMEs still fell by £723 million in the first quarter of this year.
"The government-backed British Business Bank, also launched in 2012, appears to have fared better. It lent nearly £800m to 30,000 SMEs in its latest financial year. That, however, is less than one per cent of the estimated five million SMEs employing 25 million people across the UK. Welcome relief for those that can get it, but a panacea it isn't."